It might be a cliche, but it's still true: Even in tough times, people have to eat.
Monsanto seems to have little problem competing against DuPont's
The upcoming U.S. planting season looks similarly promising. The fiscal quarter concluded at the end of November, but through the end of December, prepayments for seeds were running 50% ahead of last year. That's good news for Monsanto, but also for other agricultural stocks, like fertilizer makers PotashCorp
The great thing about Monsanto? While agriculture is somewhat cyclical, the price Monsanto can charge for seeds isn't completely connected to the price farmers can get for the food they produce. Since Monsanto is constantly coming out with new, higher-yielding seeds, it can charge incrementally higher prices, even if commodity prices stagnate. For instance, Monsanto is developing drought-resistant corn in conjunction with BASF, capable of delivering 6%-10% higher yields in drought-prone areas. If it splits the potential increased profits with the farmer, that's a substantial increase in price.
It may be a while before we see the highs that Monsanto's stock set last summer, but the company is definitely back -- big time.
Further Foolishness to chew on: